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Unilever to spin off ice cream business, cut 7,500 jobs for cost savings

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Unilever said on Tuesday it would spin off its ice cream unit, home to popular brands such as Magnum and Ben & Jerry’s, and cut 7,500 jobs in a new cost-savings programme. Investors cheered the plan, sending shares in Unilever, one of the world’s biggest consumer goods companies, up nearly 6 per cent at one point. The spinoff will begin immediately and is expected to complete by the end of 2025, London-listed Unilever said.

The plan was welcomed by activist investor and board member Nelson Peltz’s fund and by Unilever shareholder Aviva. Unilever said it aims to deliver mid-single-digit underlying sales growth and modest margin improvement after the split. The ice cream business accounts for about 16 per cent of Unilever’s global sales, and in some countries contributes a third or 40 per cent.

The group, whose other brands include Dove soap, Marmite and Hellmann’s condiments, also launched a programme to save costs of around 800 million euros ($869 million) over the next three years. The proposed changes would impact around 7,500 jobs globally, mostly office-based, with total restructuring costs anticipated to be around 1.2 per cent of overall turnover during the period.

The cuts will affect about 5.9 per cent of Unilever’s workforce of about 128,000 people. “We are looking across the organization, so in our head office, corporate centre, as well as in business group coordination points, as well as in business units in countries,” Schumacher said, but did not elaborate on which regions would be hit hardest by job cuts.


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The move is a big statement from Schumacher, who became CEO in July and in October laid out plans to win back investor confidence by simplifying the business after admitting Unilever had underperformed in recent years. His predecessor Alan Jope was criticised for allowing the group’s brand portfolio to grow to about 400, leaving management distracted from its best performers.

“The ice cream business for HUL is less than 3% of its India business. But for parent Unilever it is around 13-15%,” said Abneesh Roy, analyst at Nuvama Securities. “Important to note that in the tea business, HUL chose to retain it while its parent sold off other countries’ businesses. So we do see a low probability of any big change in HUL…”

HUL is the largest market for Unilever when it comes to the volume of products sold. In India, the packaged consumer goods company’s ice cream business, which includes Kwality Wall’s, Cornetto, and Magnum, falls under the foods and refreshments segment, which reported segmental revenue of 14,876 crore in FY23.

Unilever has also announced plans to cut 7,500 jobs globally as part of a new programme that’s expected to save it about €800 million over the next three years.

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